Determinants of Customer-Based Brand Equity in the Ethiopian Automotive Industry

Abstract

Branding plays a crucial role in contemporary marketing and has gained significant attention in both academic and professional literature. The study aims to assess the determinants of customer-based brand equity in the automotive industry in Ethiopia. For conducting this study, mixed approaches with 373 automotive customers were selected using a convenience sampling technique. The questionnaire was developed by using a five-point Likert scale. In this study, statistical measures such as correlation and regression analysis are used to evaluate the factors that contribute to customer-based brand equity in the automotive industry and the interview in narration form. This study reveals that all brand equity components such as brand knowledge, brand application, brand association, and brand relationship have statistically a positive significant effect on overall brand equity in the automotive industry in Ethiopia. The study also found out that the major constraints in the Ethiopian automotive industry are unavailability of spare parts, and shortage of foreign currency and all managers disclosed that they have no branding department in their organization structure. So, these brand equity components should be properly addressed and practiced by the marketing managers by giving priority to the brand equity determinants that have a stronger influence on customers' brand preference for the development of a robust and powerful brand, and it will be crucial for the automotive industry in Ethiopia if the government bodies such as National Bank of Ethiopia allocate adequate foreign currency reserve and Ministry of Trade and Industry improve the business tax laws, establishing favorable trade policies, and deregulate import and export regulations.